Guy Gengle, vice president of dealing at Global Forex Trading (GFT), points to the U.S.dollar/Canadian dollar (USD/CAD) as a hot trade to watch. Over the longer-term, Gengle says “I don’t think you can negate the weaker (U.S.) dollar.”

A look at a daily USD/CAD chart reveals a steady and strong downtrend in the USD, and the CAD at its highest level vs. the buck in more than a decade.

As of mid-November, the USD/CAD had pushed to a new low at the 1.18 area. Gengle sees potential for a short-term corrective bounce in the dollar, vs. Canada, which could offer short-term traders plenty of opportunity, he said. A corrective rebound could see USD/CAD bounce up toward the $1.22/1.23 zone, Gengle speculates.

Looking beyond any market correction, however, the longer-term downtrend in the U.S. dollar vs. the Canadian dollar was likely to resume, Gengle says. On the downside, he highlighted the $1.18 area as a “big level.”

Declines through that floor could open the door to further depreciation, perhaps even as low as $1.12/1.13.